The shadow market is coming out of the shadows, and the numbers are staggering. "But you should know that if you have been following my blog"

According to a report released yesterday by LPS (Lender Processing Services), “foreclosure inventory levels [stand] at 30 times monthly foreclosure sales volume.” As a result of this massive backlog, real estate analysts expect more downward pressure on U.S. home values as most of these homes are likely to reenter the market as REO properties rather than being sold in another more profitable manner[1].

The statistics on the foreclosure backlog are also staggering, with LPS reporting that the average U.S. loan currently in foreclosure has been delinquent for 537 days, and 30 percent of loans in foreclosure have not made payments in more than two years.

Thanks to slower processing times on foreclosures, it is unlikely that this backlog will disperse any time soon. In fact, although total U.S. loan delinquency has fallen nearly two percentage points over last year and foreclosure starts are down 14 percent from last year, the actual foreclosure rate is up as banks struggle to keep their books in order and intact[2]. With the “non-current inventory” logging in at nearly 7 million, the backlog is likely here to stay.

Many analysts have been predicting that 2011 will be the beginning of a recovery for many sectors of the real estate market, though most agree that the residential market has a long way to go. With this foreclosure backlog, however, do you think that home prices are likely to start a recovery by 2012?

If you do you must be on the "head stuck in the sand" train with the rest of the realtors. "LOL"

Friday, March 18, 2011

"With all the turmoil and unknown in the markets, investors today may be searching for a safe-haven. U.S. real estate wouldn't exactly sit at the top of the list for most, given the still uncertain state of the housing and credit markets, but there is one sector that seems to have fundamentals and sentiment on its side: Single Family Homes and Apartment Rentals.

We're in Boston, MA today for day two of the Spring Realty Check:

Opportunity Knocks.

Boston is home to Avalon Bay, one of the largest SFH (single family home) and apartment REITs in the nation. *Note: "This is until those reading this start working with me for minimum returns of 10% to investors in the fund. Interested? We are launching and looking for the right partners. Partners make 50% profits in the company and investors in the fund see 10% monthly returns."

Avalon Bays revenues were up 8% year over and shares are up 34% from a year ago. It's the upside to the downturn in housing. Many people who lost their homes to foreclosure have been forced to the rental market, others who are unable to get a mortgage are doing the same, and still others who would have headed toward home ownership have been scared away from the market by still falling prices. In turn, apartment vacancies are down, rents are up and REITs are reaping the rewards.

We interviewed a young couple in Boston, fiancées, and I think their insights are indicative of so many around the country. 'A lot of people are scared to buy just because if they have to move or things change, you lose money on the house and you might not be able to sell it. In my mind it's just easier and more safe to rent.' 'I think more and more people are going to go away from buying and start renting more just because it's convenient. It's a no brainer to rent, especially when you're young and you want to live in the city.'

The story appears to be the same in most cities around the country. Even though affordability is very high, renting just seems like the safer bet for many on the fence.

The big question of course is whether this is a temporary phenomenon or not?

One important fundamental of note: There is very little multi-family supply, as new construction essentially ground to a halt during the housing crash. The endless supply of REO SFH is sitting there vacant, waiting to be bought, brought back to market condition and utilized as long term rentals.

For those of you looking to be part of the new venture. We are looking for one (1) capital partner.

Capital Partner requirement: $200k Investment (these funds will be used for the opening of company branded Real Estate office and the purchase and rennovation of the first three model homes). Offices and homes are projected to generate profits within 60 days. Projected profits based on one time 200k cash injection over 15 year period is 3.2 million in cash and 40k monthly revenue. *Note: these projections are ultra conservative, and do not include any profits generated from the real estate office, Sales of the planned REIT or franchise of the business model to other states.

If you are interested, please contact us in private for full business model and to discuss working and capital relationship.

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About Me

Entrepenuer and Executive that is starting his business career outside of corporate america and looking for like minded individuals interested in making money in Real Estate while giving back to the communities we invest in.